Alignment Healthcare (ALHC) Is Crushing the Healthcare Sector—Here’s Why You Should Buy Now!

Let me tell you, folks, when I see a stock like Alignment Healthcare (ALHC) surging 33.5% year-to-date in a healthcare sector that’s only up 4.9%, I sit up and take notice. This isn’t just a good run—it’s a blockbuster performance, and it’s not happening by accident. Let’s dig into why ALHC is the star of this show and whether it’s still worth buying today.

The Numbers Don’t Lie: ALHC’s Growth Machine

First, let’s talk revenue. In Q1 2025, ALHC reported $926.9 million in revenue—a 47.5% jump from last year. That’s not a typo. And get this: they beat analyst estimates by 4.4%. Membership is exploding too—up 59% to 217,500 members. This isn’t just growth; this is disruption.

But here’s the kicker: ALHC isn’t just selling more services. They’re getting profitable. Operating margins improved to -0.6% in Q1—a 6 percentage point jump from last year. Free cash flow turned positive, hitting $8.36 million, compared to a loss of $17.36 million in Q1 2024. When a company this young can flip cash flow positive while growing revenue at 47%, that’s a game-changer.

Why Peers Are Falling Short

Let’s compare ALHC to its rivals. Take Bright Health Group (BHG), which has only gained 9.36% YTD—and that’s with a stock price of $16.35. Clover Health (CLOV) is stuck at $3.59, with YTD gains of just 2.97%. Meanwhile, Fresenius (FMS) is up a modest 5%, but its industry group is down 3.1% overall.

ALHC’s secret? Innovation. Their AVAnce platform uses tech to coordinate care for high-risk patients, while the Care Anywhere program brings in-home care to members. This isn’t just nice-to-have—it’s a retention engine. And as they expand beyond California into new states, their addressable market is blowing up.

Valuation: A Premium, but Worth It?

ALHC trades at 52.5x forward EV/EBITDA—a steep multiple. But here’s why bulls are shrugging that off: the company is scaling. Analysts project 32.6% revenue growth over the next 12 months, with full-year EBITDA guidance at $49 million. If they hit those numbers, that multiple could shrink fast.

The Zacks #2 Buy rating and a $18.22 price target (14.8% upside) suggest momentum is on their side. And let’s not forget—this is a Medicare Advantage disruptor in a sector dominated by slow-growth giants like UnitedHealth (UNH) and Humana (HUM). ALHC’s 58.6% membership surge is eating their lunch.

The Risks? Don’t Blink

Okay, okay, let’s not sugarcoat it. Risks are real. A 52.5x multiple is a skyhook—if growth slows, this stock could come crashing down. Medicare Advantage is also a regulatory minefield; any changes to CMS policies could crimp profits. And while ALHC is cash-flow positive, they’re still unprofitable on a GAAP basis.

But here’s the thing: ALHC is executing. Their MLR (medical loss ratio) is improving, and their EBITDA beat estimates by 356% in Q1. If they can keep this up, the skeptics will be eating their words.

Conclusion: ALHC Isn’t Just a Winner—It’s a Leader

The data is clear. Alignment Healthcare is outperforming on every front: revenue growth, membership expansion, profitability trends, and stock performance. With a YTD return of 33.5% versus the sector’s 4.9%, this isn’t a fluke—it’s a strategic masterpiece.

Yes, the valuation is high, and risks exist. But when a company this innovative is dominating its space with 30.3% five-year revenue growth and analysts projecting break-even EPS by year-end, this is a buy now call.

If you’re in healthcare stocks, ALHC is the one to own—don’t let this one slip away.